Power Sellers Unite

dticorp · Joined: 19 Aug 2006 Posts: 1760

link to news article

Well, I’m not sure anyone is still interested in this topic, but since I owned Glacier Bay DVD, I thought I would jump in and explain why I no longer sell on eBay or anywhere else for that matter.

You might ask why I waited 8 months to speak up, well I’ve been observing eBay over these past 8 months and I’ve come to the realization that they are a ship without a rudder, and it is affecting a group of people that I care a great deal about: EBay Sellers. So I thought I would lend my voice to the discussion. I have a unique perspective on eBay, and since I no longer sell online I can speak freely.

When I shutdown Glacier Bay I was number 2 in total feedback with 265,950 unique positives and 539,703 total positives, but I was also seriously in debt. We had been losing money since March of 2004, and I had to make a decision. Do I keep trying to make this work or is my business model so broken I’ll never be able to turn it around. I made the decision to shut it down, which was a very painful process for me, my employees, my vendors and for some of my customers. If you were affected by the failure of Glacier Bay DVD I sincerely apologize for the trouble it may have caused.

Let me be clear, in speaking out now about eBay issues, I do not blame eBay for my business failings. I made the decisions or neglected the issues that caused Glacier Bay’s demise. I ignored the competition, I didn’t adapt to the changes in the marketplace, and I didn’t cut overhead when I should have. The reason I am adding my voice to the discussion on eBay now is because I believe it can still be a fantastic “venue” for small businesses and hobbyists, and I don’t want you to go through what I did. I also want to give something back to the community of eBay sellers that are truly some of the best people in the world.

In the coming weeks I will be writing down my views of the problems facing eBay today. I invite you to challenge my positions, provide a different perspective and help move the discussion forward. If we make cogent, concise, well-reasoned arguments, maybe eBay will actually listen (yeah, right). Unfortunately, I believe the only constituents they are listening to currently are Investors.

Why should you care what I say in regards to eBay? Maybe you shouldn’t, but if you care about your business on eBay I can help you avoid some of the mistakes I made. I walked the “hallowed halls” of the eBay corporate office. I dined with top executives, including Meg Whitman—she is actually a very nice person. For a time I was the shining star of eBay. I sold over $15 million dollars worth of DVDs and CDs over 5 years on eBay. My business failed, but I hope I can help other sellers avoid the pain of failure that I have experienced.

Until recently, I never once read an eBay message board. I have been doing that a lot lately, and the passion I see in what I read had a great deal to do with my speaking out. Sure, there is a great deal of speculation, sure there is great anger but there are also great ideas and great passion for everything eBay. I’ve learned new things about: Lurkers, Trolls, Cheerleaders, and “The Tiny Mob” I want to be part of the discussion. EBay has not yet fallen off the cliff in regards to sellers, but they are teetering on the edge.

I look forward to discussing these issues and more in the coming months. As my friends from Down Under are fond of saying …

By the way here is a great article on the state of eBay.

Cheers!

ASLANstore · Joined: 20 Apr 2006 Posts: 704 Location: MidWest

HEY! I bought a DVD from that seller before!

That sounds like A LOT of fees paid - that had to hurt someone's pocket (besides obviously you of course)

Marty

2ndhandrosefrommo · Joined: 23 Feb 2005 Posts: 456

Welcome to PSU,glad you made it here. I know that you have a lot to add to this forum. We all have had times when we didn't see it coming,or we did but we kept going and said that it will get better in time. E-You,later!

LurkeyLou · Posted: Wed Sep 27, 2006 9:16 pm Post subject:

Yeah, AslanStore, you're right. It is a lot of fees paid.

I crunched some numbers and created a chart for an article I'm working on. It's about the cost of doing business between eBay and PayPal.

The thrust of the article is not to dis' eBay/PayPal, but to get sellers to take a hard look at their overhead costs. Naturally, the Cost of Doing Business (CODB) includes venue fees. While a lot of sellers are *aware* that the costs are high, not many have looked at the numbers on paper, or they don't do it on a regular basis. Not making those adjustments, not recognizing when you've been priced out of the market is, obviously, a disaster.

The proportions of the disaster GlacierBay was hit with are the wake up call to every seller, including the successful "Elite" who are pushing millions of dollars a year worth of inventory through the site.

As you can see from this chart, the best any business can do in terms of overhead w/ eBay is 13% to sell > $50.00 CORE listings. And we all know what's wrong with that scenario. Chances are, the item has to go 2+ times because the STR is around 40%...which doubles the CODB immediately.

If you have a weak stomach and still list on eBay, don't look until you steady yourself with a shot of whiskey, tequila or something else w/ kick!

If you don't have a weak stomach and are managing to pay your mortgage, car note and put food on the table without 'em, then have a look and gloat!

;-)

dticorp · Joined: 19 Aug 2006 Posts: 1760

For this reason I like eCrater.com - it is FREE !!!!

2ndhandrosefrommo · Joined: 23 Feb 2005 Posts: 456

That is why if I list an item on ebay now if it doesn't sell the 1st time around It goes someplace else. E-You,Later!

ASLANstore · Joined: 20 Apr 2006 Posts: 704 Location: MidWest

That's a nifty chart Lurkey!

...and I AM well aware of my expenses - so painfully aware lol. I know not all sellers report at the end of the year, but I do - and that bottom line shocked me a couple years ago. I made adjustments accordingly and have since leveled out (not underselling myself and certainly not "up'n the price").

But you know what chart I would be REALLY insterested in seeing? CODB online vs CODB at a B&M location.... now I realize a brick and mortar store will vary depending on locations and from State to State, etc....

but for example (and hang in there with me cuz it gets really boring right about.... now)

When I was in California and worked for a small mom and pop business, I can remember handeling purchasing as well as "the books". We were in a "so so" location, certainly not high traffic mall position, but then again not a ghost town.... and the owner revealed to me that if he get's 50% of what the store brings in after payroll, purchasing, bills etc etc (overhead) then he was living the high life.

Alternatively, I know a guy running a small architceture firm in Irvine, CA and he takes home nearly 73% of the firms total income

So anyway, when I consider those two experiences (and something tells me those experiences were exceptional and not the norm) - Living in Small Town MidWest, and working out of home - you can bet my overhead is minimal (if thousands spent at the post office and various fees and marketing is minimal lol) - but I happen to know I do better than the poor guy down the street from me who keeps his trinket shop open from sun-up to sundown and sometimes struggles to pay the store rent.

oh geez, I rambled

Marty

dticorp · Joined: 19 Aug 2006 Posts: 1760

LurkeyLou

Oh, yeah. Ouch on the cost of living in CA, much less doing business here.

AFAIK, 50% is about right for a B&M...and the actual CODB for working online is lower, but as you pointed out, generally not a whole lot once State/Fed taxes are figured in, along w/ equipment, software, ink, paper clips, electricity, etc. 73% profitiblity of net is a well run business, especially for an Irvine location!!

Maybe a good thing (depending on what the shop sells) that the owner hasn't figured out that, particularly in a small town, you can do well online. Tons more traffic than Podunk!

:wink:

damaradeaella · Joined: 23 Jul 2006 Posts: 501

Hey, I resemble that award!!!

*grin*

Actually, I came here tonight to start a thread and ending up reading this one...

What a pleasant surprise to see my Tiny Mob award here, LOL!

I think that it takes something within someone who does not need to voice an opinion to come in and offer tangible help...

I am about one pink slap away from being suspended from eBay, I am fairly certain of this... I believe I have trolls I have upset running around reporting my posts (one today was so funny, I had to laugh right out loud... It was NOT in violation, yet they accused me of "Hate Speech" against "trolls" in general, and no, I am not kidding, I was specifically offering cute logos to post when a troll crosses a board; I was slapped for that! LOL) and the corporation as a whole must know that I moderate a private group that has been running a letter writing campaign against the maltreatment of eBay sellers by eBay... Because I attempt to "riot" articulately, they have not been able to nail me on too many things... But the smacking keeps right on coming...

I'm elsewhere now (primarily HiBidder and have a store on eCrater), so why am I still "helping" out? At one time, I believed the sellers would be heard and addressed; and I might be able to go back to my store and make the money I actually need (this is not a hobby for me, even though I love what I do; making popos!)... I think if eBay were to cancel all listing fees and send me a personal apology to my home, I wouldn't blink... They have made it painfully apparent that the wants and needs of their customers (read: sellers) are not on their agenda...

I just saw my first EE commercial tonight... The one with the man who's nose is growing? I sat there, dumbfounded, looking at where our exorbitant fees are going... I was shocked at the complete absurdity, not only because it was, for lack of a better word, stupid... It was a fabrication... All items on EE are NOT new... What a crock!

The reason I came here tonight, I shall post in a separate thread, as I wish to hear more of what OP has to say...

dticorp · Joined: 19 Aug 2006 Posts: 1760

buzybee · Joined: 20 Jul 2006 Posts: 35

Great chart! ....and it gets worse. To those expenses you must also add the cost of your merchandise. Then, if you have a store that you're using those core listings to promote, there's even more profit gone. If you have a basic store with 500 unique items and use the gallery that's roughly another $50.00 a month. Sigh..... of course, if you've seen the newest eBay adds for eBay express where they're advertising NEW everything..... looks to me like they're trying to discourage sellers of used stuff. And it worked too, I'm Elsewhere now. Not making near the number of sales, but, my PayPal balance is steadily going up - not dipping each month like when eBay took their fees.

CrystalStar · Joined: 06 Mar 2005 Posts: 3571

Hey LL if they can pay the mortgage and get food etc...they ain't listing on Ebay!!!

beckysthisnthat · Joined: 02 Mar 2005 Posts: 1577 Location: Texas

Glad to see you here, dticorp, and am anxious to learn more. Will be looking for your posts.

LL, that's why I only list on eBay during the summer months with the products I do sell well there. My profit from each sale including cost of listing, cost of fvf/PP fees, cost of product and any mailing costs still bring me 41% of the final sale price at it's lowest. Many times, I can/do sell higher when the auction has multiple bidders.

I don't have a huge inventory as far as variety, but I make good money on what I sell. Some other things don't bring as high profit, but they don't break me either. I use the trade shows to cull out what doesn't go well online so I can buy/try new lines.

Thanks to PSU and other venue forums, I have learned so much about buying/shipping/listing smart just by paying attention and owe everyone a huge THANKS! :D

buzybee · Joined: 20 Jul 2006 Posts: 35

Becky, you underscored what everyone who continues to use eBay needs to do.....be more careful about what you list and, if it doesn't sell in due course, whether at auction or in a store, don't leave it listed to continue collecting fees. In my case, I made a good profit percentwise on what I sold, but since the items were so inexpensive and had to have time to attract just the right buyer, auctions were too costly and the store, overall, just became too expensive. I'm not one of those who say 'a plague on eBay'. I will continue to use it, but only when I have merchandise that makes it a worthwhile venue for me to make the profit and not eBay.

Meanwhile, I just sold another item on eCrater and I get to keep *all* the beans!